Sensorimotor gating is a pre-attentive mechanism by which the brain filters out irrelevant stimuli to produce appropriate motor responses. Abnormal sensorimotor gating is observed in several neuropsychiatric conditions, resulting in the inability to think clearly, regulate emotions, make decisions, and produce adaptive behavioral responses. Sensorimotor gating is reliably measured by the translational cross-species functional assay called prepulse inhibition (PPI) of startle reflex task. PPI indicates an individual’s ability to suppress the startle reflex in response to an intense stimulus (pulse) when preceded by a weak stimulus (prepulse). PPI deficits can occur before the onset of many other major symptoms of neuropsychiatric disorders, making it a robust diagnostic and therapeutic screening tool. However, although the reversal of PPI deficits is routinely used for pre-clinical antipsychotic drug screening, the cellular and circuit-level mechanisms of PPI remain largely unknown. Consequently, common antipsychotics show inconsistent effects on PPI and other symptoms in affected individuals, highlighting a crucial knowledge gap. Neural circuitry underlying PPI is highly conserved across species enabling the use of animal models to uncover circuit dynamics and identify potential therapeutic targets for human populations. Therefore, characterizing the neural circuitry underlying sensorimotor gating will aid the identification of novel therapeutic targets for neuropsychiatric disorders. Limbic cortico-striatal-pallido-pontine (CSPP) regions serve critical roles in sensorimotor gating. Specifically, the caudal pontine reticular nucleus (PnC), is central to startle behavior as it contains giant glutamatergic neurons that mediate the startle. Inputs into PnC originate from diverse regions, including the pedunculopontine tegmental nucleus (PPTg). Lesion studies have confirmed the necessity of PPTg in PPI and the modulation of startle. The PPTg contains three distinct neuron populations: cholinergic, glutamatergic, and GABAergic; recent investigations using chemogenetic and chemical lesions ruled out the influence of PPTg cholinergic neurons during PPI. However, the contribution of specific PPTg neurons, namely glutamatergic and GABAergic neurons, is still ill-defined. Therefore, the dissertation aims to investigate PPTg glutamatergic and GABAergic neurons in the context of sensorimotor gating by 1) determining how these neuronal populations directly innervate the PnC, 2) characterizing their function during startle and PPI, 3) identifying subpopulations of behaviorally-relevant neurons with high spatiotemporal resolution in the PPTg, and 4) examining the influence of 5HT1A receptor binding, a disease-relevant modulator, on the spontaneous activity of PPTg neurons. I used wildtype and transgenic mouse models combined with viral tracer injections and optogenetic tools to identify innervation patterns and manipulate PPTg GABAergic and glutamatergic neurons during startle and PPI. My results revealed that both glutamatergic and GABAergic neurons of the PPTg directly innervate the PnC. Moreover, I found that PPTg glutamatergic neurons provide an excitatory tone during startle modulation and that PPTg GABAergic neurons play a key role in providing an inhibitory drive during sensorimotor gating. Additionally, I identified subsets of neurons in the PPTg that are active during startle and PPI, confirming the significance of inhibitory PPTg cells during sensorimotor gating. Lastly, I found that 5HT1A receptors are found in abundance within the PPTg and activation of these receptors alters firing patterns of PPTg neurons. Altogether, these findings provide novel information about sensorimotor gating circuitry, the modulation of startle and the induction of PPI. As such, these revelations could inform therapeutic approaches to rescuing sensorimotor gating deficits in patients that are unresponsive to current treatments.